In most states there are restrictions about the use of payday loans for the consumer’s benefit. One rule in many states is that you can only have two payday loans at a time. This helps you stay out of the huge problem of having too many loans due at one time.
If you are juggling a couple payday loans and are not able to get out of either loan, you may run into a second problem. Many states will only let you take out five loans in a row without a break between loans. If you are carrying two loans, and need to renew or roll them over a couple months, you may find that by the third month you can only take out one and are stuck with a second that you cannot roll over or pay off.
There is a secret among payday loan users with experience that can help you get past this barrier. You may run into this problem over time even if you are attempting to lower each consecutive loan as you go along. For example, if you have two loans at the same time, and one is for $400 and the other for $300, but you can only reduce each by $100, here is the sequence of events:
Loan #1 is for $400 and Loan #2 is for $300. At payoff, you pay $100 on each and roll them to the next period.
Loan #3 (next period) is for $300 and Loan #4 is for $200. When these are due, you are at Loan #5 and can only take out one new loan. Just when these two are due and you want two new loans, you can only roll one over because of the 5 consecutive loans limit. Therefore, you must find enough money to repay both loans on time and then you must wait 48 hours before you can get another two loans. Managing this requires a little planning ahead.
If you cannot pay off both loans, you will need to find enough money to repay them at least for a few days. Then take out Loan #5 for only the smallest amount ($100) and repay it as soon as possible, like the next day. At that point you are reset and can start over. Take out whatever cash you need to survive to the next pay day, either in one or two new loans.
Here is the secret. If you know you cannot repay both loans in full, and need two more loans but are only allowed to do one, you have to do a tiny loan to reset the count. Take a loan (#5 of this set) out for the smallest amount ($100) and pay it off as soon as possible. Wait the 48 hour waiting period and then you can start over again with 5 more loans. Try to pay off loans quickly!